News Photo by Steve Schulwitz Alpena County Administrator Jesse Osmer works at his desk on Thursday. Osmer, the board of commissioners, and department heads are trying to determine what cuts are needed to avoid laying off employees. If a proposed property tax passes in November, it will help stabilize the county’s finances and save jobs.

ALPENA — The Alpena County savings account for its general fund has fallen to the point where if major budget cuts aren’t made, layoffs will happen.

County policy dictates that if its fund balance dips below 24.97% of budgeted expenses, part-time and temporary employees could lose their jobs, and if it falls lower than 19.97% full-time employees could begin to receive pink slips.

The commissioners could also choose to change the policy and lower the percentages to avoid layoffs, for now.

It is also possible voters in Alpena County could approve a property tax proposal during the November election, which would bolster the county’s finances and help preserve jobs.

At a budget workshop on Thursday, Alpena County Treasurer Kim Ludlow told the board of commissioners that at the beginning of the day Thursday, savings had fallen to 17.75% of budget expenses for this year’s budget, which, according to policy, means layoff notices should have already been sent out to some employees.

Ludlow said at the beginning of 2024, there was about $3.6 million in savings. That number has dipped to $2,039,941 as of Aug. 31. Ludlow said the commissioners would likely increase savings to about $3.2 million, through budget cuts, to avoid any layoffs.

“Right now, we are well below our current policy and we need to lower expenses to get back to being within policy,” Ludlow said.

Ludlow made several recommendations to the commissioners to help increase fund balance and move toward saving some jobs, at least until the results of the election are determined.

The commissioners voted to use 100% of the funds in its tax revolving fund which will add an additional $161,776 to the budget this year and an additional $243,001 for next year. The commissioners are also considering using the $800,000 from the money it received from the America Rescue Plan Act to lower the budget deficit and bolster the fund balance.

Still, Ludlow said, it still won’t be enough to save jobs and more cuts will be needed.

“Even if we use every last penny of the ARPA money, it is still below the layoff margin,” she said. “I am sharing all of this with you so you know how big of a hole we’re in.”

The county is seeking a 0.7-mill property tax increase, which would help the county recapture about $800,000 a year of what it loses to the Headlee Rollback. The tax increase would be in place for four years or until voters vote to have it removed. If the increase passes in November, it will cost the owner of a $100,000 house about $35 a year.

Before the budget process got underway, commissioners met with department heads and went through the department budgets they intended to submit to the board. The commissioners also want to receive updates from some of the department heads and to discuss potential cuts, including the sheriff’s office, animal control, and the prosecutor’s office.

If the millage fails, there is a chance the sheriff’s department could be impacted, commissioner Bill Peterson said.

“It is our biggest expense so the cuts will impact it,” he said. “I know there isn’t much left to cut. I think we need the sheriff to come and update us.”

The next budget workshop is slated for Tuesday.

Steve Schulwitz can be reached at 989-358-5689 or sschulwitz@thealpenanews.com. Follow him on Twitter @ss_alpenanews.com.